The long-short game of the future snail impact 3800, can the steel price continue to rise?

The sharp rebound in the price of snails this time is mainly due to the fact that after the oversold last week, the market changed on Friday night, and the shorts continued to reduce their positions. In addition, the spot market stopped falling over the weekend and pulled up “retaliatory”, which pushed the futures prices to continue to rise.
The overall demand release is general
Under the influence of the poor overall demand in the first half of the year, everyone will hope that a series of “stabilizing growth” measures introduced by the state in the second half of the year will speed up and show results. But from the current point of view, due to the seasonal off-season, the overall demand has not increased beyond expectations under the influence of high temperature and rainy weather.
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On July 15, the National Bureau of Statistics released economic data for the second quarter, showing that real estate is still in a downward trend. From January to June, real estate development investment fell by 5.4% year-on-year, an increase of 1.4 percentage points from January to May, and the decline expanded again in June, dragging down fixed asset investment. In June, the area of ​​housing construction fell by 48.1% year-on-year, and the decline expanded; the newly started area, which has the strongest correlation with real estate investment, fell by 44.9% year-on-year in the month.
Although the public opinion on the “stop loan tide” in real estate has declined this week, and many places are actively negotiating the construction progress, the overall demand-side release is still average.
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Supply-side pressure drops due to production cuts and depots
Under the overall weak demand, steel prices continued to fall, and steel mills were affected by losses and continued to expand production cuts. On July 15, the blast furnace operating rate of 100 small and medium-sized steel enterprises nationwide was 77.5%, down 4.9 percentage points from the highest point this year. The current average daily output of crude steel has also dropped significantly. According to statistics from the China Iron and Steel Association, the average daily output of crude steel by key steel companies in early July was 2.075 million tons, down 280,000 tons or more than 12% from the highest point this year.
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At the same time, steel inventories are also declining. At present, there have been “four consecutive declines”, with a cumulative decline of 1.134 million tons, a decline of 7.82%. Steel mill inventory pressure has also eased significantly.

Although the price of iron ore has dropped by more than 50 US dollars from the highest point this year, the price is still at a relatively high level. The price of coke has been raised and lowered in three rounds, but the current price is still the highest level in the same period in the past ten years. Under the high cost, steel mills are generally in a state of loss, ranging from a loss of about 200 yuan to a loss of 400-500 yuan. Therefore, high costs still have strong support for steel prices.

From the current point of view, the steel price has staged support, but the continuous upward momentum is insufficient, and the short-term is still in the game period between the long and the short. In the later period, we need to focus on the Fed rate hike, the global economic recession and the recovery of demand.